Lending Club Blog

The Market for Stolen Personal Information is Thriving

Having personal information stolen is only the first step in a process that ultimately leads to a loss. Increasingly, thieves are not using data directly but rather turning a faster profit by aggregating data and reselling it on the thriving black market for such information.

Newsweek recently reported on this market and its alarming growth rates. Perhaps most surprising were the low prices offered for stolen data. As more and more data finds its way to the various online marketplaces, the surplus drives prices down. Bank information was reported to cost between 5 and 10 percent of the account’s value – so details about an account containing $50,000 might sell for $2,500. Detailed credit card information sells for about $45 per account.

Lower prices for stolen data may actually be a good thing for informed consumers. With so much information available, for so little money, thieves may be less interested in obtaining data that is well protected. Those people who do a reasonable job of protecting their personal information may be passed over by thieves who can profit more quickly by stealing from less savvy marks. Of course, those with large accounts may still find themselves worthy of a thief’s efforts as a result of the higher potential payout.

The Newsweek article also discussed how thieves are becoming more specialized and selling their portion of services online. Someone good at accessing accounts may partner with someone else skilled at laundering money. This trend towards specialization works well in legitimate businesses, so it should come as no surprise that criminals are exploiting it as well.

More transactions from theft to loss also raise the possibility of the theft being detected. If just one link in the chain is discovered, you could likely take additional precautions to secure your accounts.

Theft of personal information continues to be a profitable business. Increased efficiency and specialization have matured the process to the point where many legitimate businesses could probably learn some valuable lessons from the criminal enterprise. All of the precautions in the world will not prevent a determined thief from obtaining your data, but awareness and appropriate precautions help to limit your likelihood of becoming a personal information theft victim.

Tuesday, January 27th, 2009 at 5:40 am

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